Exports Pick in July 2020, Textiles Improve

· Gold Imports Up

· General Imports Including Machinery Continue to Fall

The pace of contraction of India’s exports slowed in July even as outbound shipments shrank for the fifth consecutive month and the country’s trade balance posted a deficit after registering a surplus after 18 years in June, official data released Friday showed. Gold imports grew after eight months. The previous growth in gold imports was in November 2019.

Exports contracted 10.21% to $23.64 billion in July while imports fell 28.4% to $28.47 billion. Trade deficit was $4.83 billion compared to a $790 million surplus in June

Sixteen out of the 30 selected major commodities of export grew last month with certain employment generating sectors including ceramics, jute, cotton yarn and carpets exhibiting growth.

In an encouraging trend, exports excluding petroleum products and gems and jewelry rose in July led by engineering goods, drugs and pharmaceuticals and iron ore, among others. Gems and jewelry exports continued to shrink even though gold imports rose implying that the precious metal is being used for investment purposes amid the ongoing pandemic, instead of re-exports as jewellery.

Nayar added that this trend is likely to strengthen in the coming months, as demand for non-oil non-gold imports starts to normalise, gold imports gather steam around the festive/marriage months, and crude oil demand and prices stabilise at a moderate level.

Among imports, oil and electronics, showed slower declines than last month at 31.9% and 4.3%, respectively while gold imports were up 4.17% on year last month.

[MoC Press Release dated 14^th August 2020]

[Quick Estimates for Selected Major Commodities for July 2020]